Statoil joins Australian shale gas rush

Numerous major oil companies are sniffing around Australia’s promising shale gas acreage looking for a suitable entry in case the sector follows in the footsteps of the industry in North America, which has boomed over the past several years.
AFR

Statoil has beaten 14 other oil companies including giant ExxonMobil to become the next energy major to enter Australia’s emerging shale gas sector, and the Norwegian company has promised to spend up to $US210 million in a venture with PetroFrontier.

The deal links the $US75 billion major with the Canadian explorer in its permits in the central-east of the Northern Territory, where Central Petroleum also has extensive holdings. The partners, which include
Baraka Energy & Resources
in two permits, could drill up to 20 wells by 2017, depending on results.

The venture reflects Statoil’s aim, which is to “access shale plays at an early exploration stage, at low cost and develop them into potentially high-value assets," said Atle Rettedal, Statoil’s senior vice president for new ventures.

Various energy companies are sniffing around Australia’s promising shale regions, where gas resources could total some 390 trillion cubic feet, according to government estimates. So far, only BG Group, Mitsubishi, Hess Corporation and ConocoPhillips have taken interests. Other energy companies are examining plays, including BP, BHP Billiton, Chevron, ExxonMobil, Shell and Total.

Meanwhile a battle between mining magnate
Clive Palmer
and gas industry identity Richard Cottee for effective control over Central is set to play out today at shareholder votes in Perth. Central has attracted 15 expressions of interest from parties looking to invest in its Northern Territory acreage.

Statoil and PetroFrontier will each contribute $US25 million to initial exploration. A second-stage program would involve another $US100 million and a third stage $US80 million.